Clarks Corporation uses the FIFO method in its process costing. The following data pertain to its Assembly Department for June. Units in process, June 1: materials 85% complete, conversion 20% complete700Units started into production during June9,400Units completed and transferred to the next department8,300Units in process, June 30: materials 90% complete, conversion 60% complete1,800 Required:Determine the equivalent units of production for the Assembly Department for June using the FIFO method.
What will be an ideal response?
FIFO method:
Units started and completed during the period = Units completed during the period - Units in beginning work in process inventory = 8,300 - 700 = 7,600
| Materials | Conversion | |
| To complete beginning work in process: | ||
| Materials: 700 units × (100% ? 85%) | 105 | |
| Conversion: 700 units × (100% ? 20%) | 560 | |
| Units started and completed | 7,600 | 7,600 |
| Ending work in process: | ||
| Materials: 1,800 units × 90% | 1,620 | |
| Conversion: 1,800 units × 60% | 1,080 | |
| Equivalent units of production | 9,325 | 9,240 |
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